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Thursday, March 28, 2013

Sugar Program: The Basics



Remy Jurenas
Specialist in Agricultural Policy

The sugar program provides a price guarantee to the processors of sugarcane and sugar beets, and in turn, to the producers of both crops. The U.S. Department of Agriculture (USDA) further is directed to administer the program at no budgetary cost to the federal government by limiting the amount of sugar supplied for food use in the U.S. market. To achieve both objectives, USDA uses four tools—authorized by the 2008 farm bill and longstanding trade law—to keep domestic market prices above guaranteed levels. These are:


  • price support loans at specified levels—the basis for the price guarantee, 
  • marketing allotments to limit the amount of sugar that each processor can sell, 
  • import quotas to restrict the amount of sugar allowed to enter the U.S. market, 
  • a sugar-to-ethanol (feedstock flexibility) backstop—available if marketing allotments and import quotas fail to prevent a sugar surplus from developing (i.e., fail to keep market prices above guaranteed levels).


Date of Report: March 14, 2013
Number of Pages: 11
Order Number: R42535
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Monday, March 25, 2013

Environmental Regulation and Agriculture



Megan Stubbs, Coordinator
Specialist in Agricultural Conservation and Natural Resources Policy

As the U.S. and global economies continue to struggle, some inside and outside of Congress have expressed concern about how environmental regulation may stifle growth and productivity. Much of the criticism has focused on environmental regulations promulgated by the Environmental Protection Agency (EPA). Some claim that EPA is overreaching its regulatory authority and imposing costly and burdensome requirements on society. In general, the agriculture community, among others, has been vocal in its concerns, contending that EPA appears to be focusing some of its recent regulatory efforts on agriculture. Many public health and environmental advocates, on the other hand, support many of EPA’s overall regulatory efforts and in some cases argue that EPA has not taken adequate action to control the impacts of certain agricultural activities. Where agriculture contributes to environmental impairment, these groups say, it is appropriate to consider ways to minimize or eliminate the adverse impacts.

Growing interest in the impact of regulatory actions on many sectors of the economy is evident in Congress, which continues to examine the role of EPA and other federal agencies in regulating environmental protection. Congress has a number of policy options to address or respond to potential regulatory impacts.

Most environmental regulations, in terms of permitting, inspection, and enforcement, are implemented by state and local governments, often based on federal EPA regulatory guidance. In some cases, agriculture is the direct or primary focus of the regulatory actions. In other cases, agriculture is one of many affected sectors. Traditionally, farm and ranch operations have been exempt or excluded from many environmental regulations. Given the agricultural sector’s size and its potential to affect its surrounding environment, there is interest in both managing potential impacts of agricultural actions on the environment and also maintaining an economically viable agricultural industry. Of particular interest to agriculture are a number of regulatory actions affecting air, water, energy, and chemicals. 

Air 


Agricultural production practices from both livestock and crop operations generate a variety of substances that enter the atmosphere, potentially creating health and environmental issues. Recent actions by EPA to regulate emissions and pollutants have drawn criticism, including greenhouse gas emission reporting and permitting requirements, and National Ambient Air Quality Standards (NAAQS) related to particulate matter (commonly referred to as dust). The agricultural community continues to show particular interest in NAAQS because some farming and livestock practices contribute to particulate matter emissions. 

Water 


Water quality issues also are of interest to the agricultural industry. Water is an input for production and can also be degraded as a result of production through the potential release of sediment, nutrients, pathogens, and pesticides. The extent and magnitude of water quality degradation from agriculture practices varies greatly, but agriculture is proven to be a significant source of impairment of several U.S. waters. Federal environmental laws largely do not regulate agricultural actors, in many cases giving the regulatory responsibilities to the states. One exception is large concentrated animal feeding operations (CAFOs), which are subject to permitting requirements. Constraints on agricultural production to reduce pollution discharges typically arise at the state level in response to local concerns, and how to manage agricultural sources has been a prominent issue in several large watershed restoration efforts, such as those in the Chesapeake Bay and Florida Everglades. 

Energy 


Changes in energy policy, namely increased bioenergy production, have recently become important to many in the agricultural industry, based on the potential of corn-based biofuel production to contribute to the nation’s energy supply through both the renewable fuel standard (RFS) and the increased percentage of ethanol in gasoline (E15). 

Chemicals 


Hundreds of chemical products are available to repel or kill “pests” that affect agricultural production. The federal regulation of these chemicals includes registering and restricting their use. The risks associated with agricultural chemical use and possible impacts on human health and the environment also have led to recent federal regulatory reviews of chemical fertilizer and pesticide use.


Date of Report: March 12, 2013
Number of Pages: 51
Order Number: R41622
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Thursday, March 21, 2013

The Pigford Cases: USDA Settlement of Discrimination Suits by Black Farmers



Tadlock Cowan
Analyst in Natural Resources and Rural Development

Jody Feder
Legislative Attorney


On April 14, 1999, Judge Paul L. Friedman of the U.S. District Court for the District of Columbia approved a settlement agreement and consent decree in Pigford v. Glickman, a class action discrimination suit between the U.S. Department of Agriculture (USDA) and black farmers. The suit claimed that the agency had discriminated against black farmers on the basis of race and failed to investigate or properly respond to complaints from 1983 to 1997. The deadline for submitting a claim as a class member was September 12, 2000. Cumulative data show that as of December 31, 2011, 15,645 (69%) of the 22,721 eligible class members had final adjudications approved under the Track A process, and 104 (62%) prevailed in the Track B process, for a total cost of approximately $1.06 billion in cash relief, tax payments, and debt relief.

Many voiced concern over the structure of the settlement agreement, the large number of applicants who filed late, and reported deficiencies in representation by class counsel. A provision in the 2008 farm bill (P.L. 110-246) permitted any claimant who had submitted a late-filing request under Pigford and who had not previously obtained a determination on the merits of his or her claim to petition in federal court to obtain such a determination. A maximum of $100 million in mandatory spending was made available for payment of these claims, and the multiple claims that were subsequently filed were consolidated into a single case, In re Black Farmers Discrimination Litigation (commonly referred to as Pigford II).

On February 18, 2010, Attorney General Holder and Secretary of Agriculture Vilsack announced a $1.25 billion settlement of these Pigford II claims. However, because only $100 million was made available in the 2008 farm bill, the Pigford II settlement was contingent upon congressional approval of an additional $1.15 billion in funding. After a series of failed attempts to appropriate funds for the settlement agreement, the Senate passed the Claims Resolution Act of 2010 (H.R. 4783) to provide the $1.15 billion appropriation by unanimous consent on November 19, 2010. The Senate bill was then passed by the House on November 30 and signed by the President on December 8 (P.L. 111-291).

Like the original Pigford case, the Pigford II settlement provides both a fast-track settlement process and higher payments to potential claimants who go through a more rigorous review and documentation process. A moratorium on foreclosures of most claimants’ farms will remain in place until after claimants have gone through the claims process. On October 27, 2011, the U.S. District Court for the District of Columbia granted final approval of the settlement agreement. Under the terms of the court order, claims could be submitted beginning on November 14, 2011, with a deadline for filing claims of May 11, 2012. Because no payments will be made until the merits of all claims have been heard, it is unclear when successful claimants will actually receive awards. A determination of the validity of claims is expected to be completed in the first part of 2013, after which the claims administrator will begin distributing payments to successful claimants.

This report highlights some of the events that led up to the original Pigford class action suit and the subsequent Pigford II settlement. The report also outlines the structure of both the original consent decree in Pigford and the settlement agreement in Pigford II. In addition, the report discusses the number of claims reviewed, denied, and awarded under Pigford, as well as some of the issues raised by various parties under both lawsuits. It will be updated periodically.


Date of Report: March 12, 2013
Number of Pages: 14
Order Number: RS20430
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Friday, March 15, 2013

Budget Issues Shaping a Farm Bill in 2013



Jim Monke
Specialist in Agricultural Policy

The desire by many to redesign farm policy and reallocate the remaining farm bill baseline—in a sequestration and deficit reduction environment—is driving much of the farm bill debate this year. Several high-profile congressional and Administration proposals for deficit reduction have specifically targeted agricultural programs with mandatory funding. The political dynamics of sequestration and broader deficit reduction goals leave open difficult questions about how much and when the farm bill baseline may be reduced. In this context, Congress faces difficult choices about how much total support to provide for agriculture, and how to allocate that support among competing constituencies.

Funding to write the next farm bill is based on Congressional Budget Office (CBO) baseline projections of the cost of farm bill programs, and on varying budgetary assumptions about whether programs will continue. The CBO baseline is an estimation (projection) at a particular point in time of what federal spending on mandatory programs likely would be under current law. In February 2013, CBO projected that the current farm bill programs, if they were to continue beyond the 2008 farm bill, would cost $976 billion over the next 10 years (FY2014-FY2023).

When new bills are proposed that affect mandatory spending, their impact (or “score”) is measured as a difference from the baseline. This baseline and scoring process sets the mandatory budget for considering a new farm bill. As a starting point for the 113
th Congress, CBO reestimated two farm bill proposals from 2012 against the new baseline and with new analysis about the provisions. The Senate-passed farm bill in the 112th Congress, S. 3240, would reduce spending by $13.1 billion (-1.3%); and the House-reported bill, H.R. 6083, would reduce it by $26.6 billion (-2.7%). Both of these estimates reflect about $10 billion less in savings than was scored last year, primarily because of the impact of drought and market prices, and because of new understandings about the implementation of nutrition programs. Thus, compared to last year, a new farm bill may cost more than expected, or additional reductions may be necessary to achieve the same deficit reduction.

Also, across-the-board reductions of about 5%, known as budget sequestration, have occurred and total $1.9 billion in FY2013 for agriculture and related agencies spending—$1.2 billion from discretionary spending and $700 million from mandatory programs. Moreover, some popular 2008 farm bill programs do not have a baseline to continue, and will require additional budgetary offsets if they are included in a new farm bill.



Date of Report: March 11, 2013
Number of Pages: 33
Order Number: R42484
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The Role of Local Food Systems in U.S. Farm Policy



Renée Johnson
Specialist in Agricultural Policy

Randy Alison Aussenberg
Analyst in Nutrition Assistance Policy

Tadlock Cowan
Analyst in Natural Resources and Rural Development


Sales of locally produced foods comprise a small but growing part of U.S. agricultural sales. USDA estimates that farm-level value of local food sales totaled about $4.8 billion in 2008, or about 1.6% of the U.S. market for agricultural products. An estimated total of 107,000 farms are engaged in local food systems, or about 5% of all U.S. farms.

There is no established definition of what constitutes a “local food.” Local and regional food systems generally refer to agricultural production and marketing that occurs within a certain geographic proximity (between farmer and consumer) or that involves certain social or supply chain characteristics in producing food (such as small family farms, urban gardens, or farms using sustainable agriculture practices). Some perceive locally sourced foods as fresher and higher in quality compared to some other readily available foods, and also believe that purchasing local foods helps support local farm economies and/or farmers that use certain production practices that are perceived to be more environmentally sustainable.

A wide range of farm businesses may be considered to be engaged in local foods. These include direct-to-consumer marketing, farmers’ markets, farm-to-school programs, community-supported agriculture, community gardens, school gardens, food hubs and market aggregators, and kitchen incubators and mobile slaughter units. Other types of operations include on-farm sales/stores, internet marketing, food cooperatives and buying clubs, pick-your-own or “U-Pick” operations, roadside farm stands, urban farms (and rooftop farms and gardens), community kitchens, smallscale food processing and decentralized root cellars, and some agritourism or other types of onfarm recreational activities.

The 2008 farm bill (P.L. 110-246, Food, Conservation, and Energy Act of 2008) contained a few program provisions that directly support local and regional food systems. However, many existing federal programs benefiting U.S. agricultural producers may also provide support and assistance for local food systems. These include farm support and grant programs administered by the U.S. Department of Agriculture (USDA), and may be grouped into several broad program categories: marketing and promotion; business assistance; rural and community development; nutrition and education; agricultural research and cooperative extension; and farmland conservation. Examples include USDA’s farmers’ market programs, rural cooperative grants, and selected child nutrition programs, among myriad other grant and loan programs, as well as USDA’s research and cooperative extension service. Farm bill proposals debated in the 112
th Congress would have expanded several of these programs.

The 113
th Congress will likely consider reauthorization of the 2008 farm bill and may reconsider proposals debated in the 112th Congress to address expiring farm bill provisions, including provisions that either directly or indirectly support local food systems. Although the 2008 farm bill contained few specific programs that directly support local and regional food systems, many community and farm advocacy groups have been arguing that such food systems should play a larger policy role within the next farm bill, and that laws should be modified to reflect broader, more equitable policies across a range of production systems, including local food systems. The 112th Congress introduced legislation, including several comprehensive marker bills, which would have expanded the benefits for local and regional food systems. These issues may continue to be of interest in the 113th Congress.


Date of Report: March 12, 2013
Number of Pages: 65
Order Number: R42155
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